Salesforce and Microsoft Battle It Out Over Patent Violations

Last week, Salesforce.com countersued Microsoft for patent-infringement. Microsoft sued Salesforce first, in May, over intellectual property infringement. These customer relationship management (CRM) competitors are battling it out over patent violations. Microsoft and Salesforce are both seeking an injuction and monetary compensation for the violations.

Microsoft claims that Salesforce’s CRM software violates nine Microsoft patents. Microsoft wants Salesforce to stop using any technology that violates Microsoft’s patents. This in addition to monetary penalties could hurt Salesforce.com drastically while giving Microsoft a leg up in the CRM solutions arena.

Horacio Gutierrez, the Corporate Vice President and Deputy General Counsel of Intellectual Property and Licensing for Microsoft, commented on the law suit. He said, “Microsoft has been a leader and innovator in the software industry for decades and continues to invest billions of dollars each year in bringing great software products and services to market. We have a responsibility to our customers, partners, and shareholders to safeguard that investment, and therefore cannot stand idly by when others infringe our IP rights.”

Salesforce was not willing to negotiate so the two companies will be going to court. Salesforce decided to hit Microsoft back on Thursday, when the law suit against Microsoft was filed. Salesforce claims that many Microsoft products, including SharePoint Collaboration and .NET platform, violate Salesforce’s patents.

The fight is getting ugly as Salesforce CEO, Marc Benioff, called Microsoft a “patent troll” and an “alley thug”. Microsoft has filed four other patent-infringement suits in the past. Both companies represent a large part of the CRM market and they are direct competitors. It is likely both companies feel threatened by the other and this is the reason that the patent fight is becoming so intense. In history, the longer-standing and wealthier company, which in this case would be Microsoft, would win. On the other hand, Salesforce is a strong and growing company with one of the best prosecuting attorneys in the U.S., David Boise.

Whichever company loses will be hit hard; especially Salesforce because the company is newer and relies heavily on their CRM applications, which are in question.